What is financial and banking arbitration?

What is financial and banking arbitration?

The body consists of five members and replaces the judge to provide immediate solutions in disputes between banks, intermediaries and customers.

Article 128-bis of Consolidated Banking Act (TUB) set up the creation of the Financial Banking Ombudsman (ABF), a body in charge for settling disputes between individuals and banks and/or financial intermediaries. The promoter of the ABF is the Bank of Italy, according to the Resolution of 29/07/2008 of the Inter-Ministerial Committee for Credit and Savings.
The new body is defined extra-judicial, born as an alternative, in the perspective of simplification and economic and time saving, to appeal to the judge that involves longer and more expensive procedures.
The ABF, an independent and impartial body, deliberates on cases of dispute in a few months. It is a system distinct from conciliation and arbitration by virtue of the non-binding nature of the decisions issued, whose non-compliance by the intermediary involves the public visibility of the non-compliance. The customer can request the involvement of the ABF only after a failed attempt to solve the problem directly with the bank or the intermediary through a claim; he can also, if not satisfied with the decisions of the ABF, appeal to the judge.
The ABF consists of a deciding body that is divided into three Colleges located in Milan, Rome and Naples, each with a Technical Secretariat, whose activity is carried out by the Bank of Italy. The Deciding Body of each College counts 5 members with requisites of experience, professionalism, integrity and independence. Two members and the President are appointed by the Bank of Italy, one by the Associations of Intermediaries, one by the Associations representing customers (businesses and consumers).
The term of office of the President expires in the fifth year from his appointment, while that of the other members in the third one and it can be renewed only once. The members of the Board are chosen according to impartiality criteria, in order to represent the interests of all the parties involved. The ABF can decide on disputes up to €100,000.00 if a sum of money is requested, if you ask for the verification of powers, obligations or rights then it can decide on disputes without limits of amount.
The new body was immediately successful: from the 15th of October to the 31st of March 2010 it examined 1052 appeals, of which 22% in Naples, 34% in Rome, 44% in Milan, and up to the 31st of March 2010 adopted 250 decisions, following the path of promptness with a view to reducing litigation and increasing the stability of the banking system.


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